Beads on string spelled out the word 'pension' © iStock

Dear Liz,

I work for the government. When I retire, I will have my federal pension, but I can’t take any of my husband’s Social Security. He has been paying into Social Security for almost 35 years. How is that fair to me?

— Nadia

Dear Nadia,

Although your situation may appear unfair at first glance, the Government Pension Offset, which affects your benefits, was implemented to keep government employees who didn’t pay taxes into Social Security from getting a larger Social Security benefit than their private sector peers.

Typically, Social Security benefits for spouses and survivors are offset by any benefit they would be eligible to receive on their own records. If you qualify for a Social Security retirement benefit, for example, that would be compared with your spousal benefit. Essentially, you would get the larger of the 2. If your spousal benefit were larger, you would get your retirement benefit plus a supplement that brought your check up to that larger amount. With survivors benefits, you would get whichever check was larger.

What you would not get is your own benefit plus a spousal or survivors benefit with no offset. Before the Government Pension Offset was created, though, people who didn’t pay into Social Security were able to get exactly that: their own (often generous) pension, plus a full spousal or survivors benefit, with no reduction.

To prevent government pensioners from getting an outsized benefit, Social Security reduces any spousal or survivors benefit by two-thirds of your government pension.

How Government Pension Offset works

If you get a government pension of $1,200, two-thirds of that amount, or $800, would be deducted from your Social Security benefits. This is known as the Government Pension Offset. Even if you elect to take your government pension in a lump sum, the amount you get from Social Security would be reduced as if you were getting a monthly pension.

Source: Social Security Administration.

If you can delay starting your pension for a while, you could take your spousal benefit in the meantime. Whether it makes sense to do so depends on the details of your situation. A more sophisticated claiming strategies calculator, like the one offered at MaximizeMySocialSecurity.com for $40, could help you explore your options.

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